1. Field
The disclosed embodiments generally relate to a system and method for establishing a market price for a product, and in particular a system and method for determining price based on value to the consumer.
2. Brief Description of Related Developments
Customer perceived value has become a popular basis for marketing analysis and strategy. The concepts of customer perceived value are described in Managing Customer Value, by Bradley T. Gale, The Free Press, 1994. It is advantageous to extend these concepts and apply them to a method and system for determining a competitive price position for a target product.
Two widely used approaches to measuring the differences in worth among competing products are cost-in-use analysis and importance-performance analysis. It is a purpose of the system and method of this application to combine and extend certain aspects of these traditional approaches to provide a system for measuring and analyzing the differences in worth/value among competing products while accounting for customer perceived value. It is a further purpose of the system and method of this application to apply the result to obtain a price for a product which strategically reflects its value to the purchaser relative to other products in the market.